If the efficient markets hypothesis is valid, then a person should:
I. buy mutual funds.
II. diversify.
III. follow a buy-and-hold strategy.
A) I and II only
B) I and III only
C) II and III only
D) I, II, and III

Question

Quizplus · Accepted Answer

The efficient markets hypothesis states that all available information is reflected in the prices of securities, so it is impossible to consistently beat the market. Therefore, a person should diversify their investments and follow a buy-and-hold strategy to minimize risk and maximize returns.

If the Efficient Markets Hypothesis Is Valid, Then a Person